Bignell v Nelson Sun Club Incorporated
[2020] NZHC 1141
•27 May 2020
IN THE HIGH COURT OF NEW ZEALAND NELSON REGISTRY
I TE KŌTI MATUA O AOTEAROA WHAKATŪ ROHE
CIV-2019-442-81
[2020] NZHC 1141
UNDER the Insolvency Act 2006 BETWEEN
GARY ARTHUR BIGNELL
Applicant
AND
NELSON SUN CLUB INCORPORATED
Respondent
Hearing: 27 May 2020
(On the papers)
Counsel:
L F McDonald for Applicant G J Praat for Respondent
Judgment:
27 May 2020
Reissued:
28 May 2020
RULING OF ASSOCIATE JUDGE LESTER
(admissibility)
This judgment was delivered by me on 27 May 2020 at 2.30pm And re-issued on 28 May 2020 at 3.30pm pursuant to Rule 11.5 of the High Court Rules
Registrar/Deputy Registrar 28 May 2020
BIGNELL v NELSON SUN CLUB INCORPORATED [2020] NZHC 1141 [27 May 2020]
[1] The applicant in this proceeding seeks an order vesting in him a cause of action set out in a draft statement of claim against the respondent.
[2]As the matter is an originating application, it is advanced on affidavit evidence.
[3] Counsel for the applicant has, in a memorandum dated 8 May 2020, raised issues about two aspects of the proceeding. Those concerns were first raised in a memorandum dated 28 April 2020 for a telephone conference to be heard on 30 April 2020. The first issue is the status of a claim the applicant’s wife believes she has against the respondent. The present applicant is concerned that the respondent is taking some objection to his wife’s claim. That issue is readily dealt with as the respondent has confirmed it is not objecting to the applicant’s wife pursuing her claim for what it is worth. The respondent accepts such is a matter for Ms Bignell to decide and the Court is not required to make any determination in that regard in the present application. Accordingly, that issue will not arise in this application.
[4] The second issue is what the applicant characterises as, the respondent accusing him of unlawful conduct.
[5] The notice of opposition refers to the applicant having “demonstrated a cavalier attitude towards his responsibilities as an undischarged bankrupt”. The respondent says the applicant failed to disclose to the Official Assignee two dwellings or baches. The notice of opposition was dated 28 February 2020. Affidavits in support of the notice of opposition were filed on 9 March 2020.
[6] The evidence relied on by the respondent in support of its allegation that the applicant did not comply with his obligations as a bankrupt is contained at paragraphs 5-7 of Mr Beasley’s affidavit sworn 6 March 2020 (the evidence). Mr Bignell replied to the evidence at paragraphs 8-11 of his affidavit sworn 28 April 2020.
[7] Mr McDonald, counsel for the applicant, in his memorandum for the 30 April 2020 conference, submitted that the evidence should be excluded. As I vacated the conference, Mr McDonald did not have the chance to address this issue.
In his memorandum of 8 May 2020 seeking a ruling on the admissibility of the evidence, Mr McDonald has referred to the very high standard that applies to the pleading of fraud or dishonesty, referring to Schmidt v Pepper New Zealand (Custodians) Ltd.1
[8]Mr Beasley’s evidence relating to his allegations begins with the following:
The Respondent understands that the Applicant has, during the course of his most recent bankruptcy, failed to adequately account for two separate property interests.
There then follows a description of the two assets said not to have been disclosed. No evidence is given that the property is owned by the applicant.
[9] Mr Bignell denies the allegation that he has failed to properly account to the Official Assignee and provides an explanation under oath in relation to the two property interests said not to have been disclosed.
[10] It is not, as counsel for the respondent in a memorandum of 20 May 2020 asserts, for the applicant to prove that he has complied with his obligations under the Insolvency Act 2006 in respect of disclosure to the Official Assignee. It is for the respondent to provide proper particulars of what amounts to an allegation of wrongdoing by the applicant.
[11] Applicant’s counsel in his memorandum for the 30 April 2020 hearing sought that the evidence referred to at [8] above be excluded on the ground that it does not provide anywhere near the particulars required in respect of a pleading of what amounts to criminal conduct.
[12] In my view, the evidence at [8] is no more than a bare assertion. All Mr Beasley is saying is what he understands the position to be. In respect of one bach said not to have been disclosed, Mr Beasley says the circumstances surrounding the ownership of that dwelling are set out in the affidavit of Mr Kelleher.
1 Schmidt v Pepper New Zealand (Custodians) Ltd [2012] NZCA 565 at [15].
[13] Accordingly, Mr Beasley’s “understanding” in relation to the first dwelling is based on the evidence of Mr Kelleher.
[14] In respect of the first dwelling, Mr Kelleher says: “In 2014, Gary Bignell and Stephanie Bignell purchased a bach from another member and have owned it since then.”
[15] The basis upon which Mr Kelleher claims to have this knowledge is not given. He does not explain how it is he is able to make this statement. This is a bare assertion. There is no evidence from the member said to have sold the bach to both Mr and Mrs Bignell. There is no evidence that Mr Kelleher has any direct knowledge of the claimed transaction, for example, that he was present when the deal was negotiated or that he had seen a written contract. He does not even claim to have been told by the vendor of the sale. As to the lease of the land area with this bach was located and power, Mr Kelleher says: “As far as I know, Mr Bignell paid for these expenses from his own resources.”
[16] It is not quite clear to me what is meant by “As far as I know”. This assertion is insufficient to found an allegation of improper/criminal conduct. It amounts, in my view, to an inadmissible statement of opinion or understanding. Such evidence is inadmissible under s 23 of the Evidence Act 2006 unless it is made admissible by either s 24 or s 25 of the Act. Section 25 has no application because it deals with expert evidence. Section 24 provides for lay opinion evidence, when that evidence is necessary to enable the witness to explain, or the fact finder to understand what the witness saw, heard or perceived.
[17] In respect of the second dwelling, Mr Beasley’s evidence does not arise above assertion. Mr Beasley seems to base the claim the applicant has an interest in the second dwelling on the assertion that it was the applicant, together with his wife, that moved it onto the respondent’s land. On the strength of the applicant being involved in moving the second bach onto the respondent’s land, the respondent assumes that the applicant has an ownership interest in that bach which he failed to disclose in his bankruptcy.
[18] This is no more than an assumption and insufficient to found an allegation that the applicant made a false declaration to the Official Assignee.
[19] I conclude the evidence at paragraphs 5-7 of Mr Beasley’s affidavit and at paragraph 6 of Mr Kelleher’s affidavit is inadmissible and will not be read.
[20] Nor is this an area covered by the leave given to the respondent’s to reply to the affidavit of the applicant. It was for the respondent to give full details of the alleged unlawful conduct. It did not do so, its evidence being little more than bare assertion which was met with a denial. The limited leave to reply would not permit the respondent to now in reply put up material that it should have put to the applicant at the outset. In short, the respondent has not provided proper evidence to found the allegation that the applicant has acted improperly.
[21] This ruling addresses the issues raised by applicant’s counsel and the matter will proceed on the fixture date as previously allocated.
Associate Judge Lester
NOTICE REQUIREMENT
The solicitors on the record for the parties are promptly to provide a copy of this Ruling to their clients (r 5.43).
Solicitors:
Hamish Fletcher Lawyers, Nelson Knapps Lawyers, Nelson
1
0